MILWAUKEE, Oct. 26,
2023 /PRNewswire/ -- Harley-Davidson, Inc.
("Harley-Davidson," "HDI," or the "Company") (NYSE: HOG) today
reported third quarter 2023 results.
"Against a challenging macro and consumer backdrop, we have been
able to achieve a result that preserves profitability at
an industry leading level. In addition, we successfully launched
our pinnacle CVO motorcycles, with CVO retail sales up 25%," said
Jochen Zeitz, Chairman, President
and CEO, Harley-Davidson. "Harley-Davidson remains committed to its
Hardwire strategy with a focus on both desirability and
profitability, and we will do everything possible to achieve our
goals while being realistic that current market conditions are
complex. We are gearing up for '24 and will ensure that we are
fully aligned and ready as we close out the year with Q4."
Third Quarter 2023 Highlights and Results
- Strategy remains grounded in desirability and
profitability
- Successful launch of two new CVO motorcycles, CVO retail sales
up +25%, with new features aligning with consumer preferences
- HDMC Gross Margin of 31.7%
- HDMC Revenue declined 9%, behind a 20% decrease in wholesale
shipments
- HDFS Revenue increased 15% on higher interest income
- LiveWire commenced production and launch of the Del Mar
electric motorcycle
- Delivered diluted EPS of $1.38
- Company reaffirms its most recent full year 2023 outlook
Year-to-date 2023 Highlights and Results
- Achieved HDMC Operating Income Margin of 17.4%
- HDMC Revenue was up 2 percent versus prior year, with global
pricing and improved mix offsetting lower wholesale motorcycle unit
shipments
- Delivered diluted EPS of $4.65
- Repurchased $226 million of
shares (6.1 million shares) on a discretionary basis
Third Quarter 2023 Results
Harley-Davidson, Inc. Consolidated Financial
Results
$ in millions
(except EPS)
|
3rd quarter
|
2023
|
2022
|
Change
|
Revenue
|
$1,549
|
$1,649
|
-6 %
|
Operating
Income
|
$209
|
$339
|
-38 %
|
Net Income Attributable
to HDI
|
$199
|
$261
|
-24 %
|
Diluted EPS
|
$1.38
|
$1.78
|
-22 %
|
Consolidated revenue was down 6 percent in the third quarter,
driven by a revenue decline of 9 percent at HDMC, which was
partially offset by revenue growth of 15 percent at HDFS.
Consolidated operating income in the third quarter was down 38
percent, driven by a decline of 37 percent at HDMC, a decline of 27
percent at HDFS, and an operating loss of $25 million in the LiveWire segment. Consolidated
operating income margin in the third quarter was 13.5 percent
compared to 20.6 percent in the third quarter a year ago.
Harley-Davidson Motor Company (HDMC) – Results
$ in
millions
|
3rd quarter
|
2023
|
2022
|
Change
|
Motorcycle Shipments
(thousands)
|
45.3
|
56.9
|
-20 %
|
Revenue
|
$1,297
|
$1,422
|
-9 %
|
Motorcycles
|
$1,023
|
$1,129
|
-9 %
|
Parts
& Accessories
|
$185
|
$201
|
-8 %
|
Apparel
|
$49
|
$70
|
-29 %
|
Licensing
|
$10
|
$11
|
-10 %
|
Other
|
$30
|
$12
|
148 %
|
Gross Margin
|
31.7 %
|
34.4 %
|
-2.7 pts.
|
Operating
Income
|
$175
|
$279
|
-37 %
|
Operating Income
Margin
|
13.5 %
|
19.6 %
|
-6.1
pts.
|
Third quarter global motorcycle shipments decreased 20 percent,
due to the production suspension announced in late Q2 2023, prudent
dealer inventory management and market conditions, in line with our
latest guidance. Revenue was down 9 percent, with improved mix and
global pricing partially offsetting unit declines. Parts &
Accessories revenue was down 8 percent largely in-line with revenue
from Motorcycles. Apparel revenue was down 29 percent driven by
lower volumes in North
America.
Third quarter gross margin was down 2.7 points behind the
impacts of lower volumes, unfavorable manufacturing impacts, and
foreign currency, more than offsetting the benefits of pricing and
shipment mix. Third quarter operating income margin fell by 6.1
points due to higher operating expense, including higher people
costs and marketing spend.
Harley-Davidson Retail Motorcycle Sales
(excludes LiveWire units)
Motorcycles
(thousands)
|
3rd quarter
|
2023
|
2022
|
Change
|
North
America
|
27.3
|
32.0
|
-15 %
|
EMEA
|
7.8
|
9.0
|
-13 %
|
Asia Pacific
|
5.8
|
7.6
|
-24 %
|
Latin
America
|
0.7
|
0.7
|
-11 %
|
Worldwide
Total
|
41.7
|
49.4
|
-16 %
|
Global retail sales of Harley-Davidson motorcycles in the third
quarter were down 16 percent versus prior year, adversely impacted
primarily by macro conditions in key geographies. North America retail performance was down 15
percent, impacted by both the high interest rate environment in
North America and discontinuation
of legacy Sportster at the end of 2022. The decline in EMEA of 13
percent was driven by weakness in the German regional market and
the planned unit mix shift towards the profitable core product
segments. The decline in APAC of 24 percent was primarily driven by
weaker than expected demand in China. Latin
America sales declines were driven by weakness in
Brazil, partially offset by growth
in Mexico.
Harley-Davidson Financial Services (HDFS) – Results
$ in
millions
|
3rd quarter
|
2023
|
2022
|
Change
|
Revenue
|
$244
|
$212
|
15 %
|
Operating
Income
|
$59
|
$81
|
-27 %
|
HDFS revenue was up $32 million in
the third quarter, an increase of 15% versus prior year, driven
primarily by higher interest income. HDFS operating income decline
of $22 million, or down 27 percent,
was driven by an increased provision for credit losses and higher
interest expense. The increase in the provision for credit losses
was driven by several factors relating to the current macroeconomic
environment. Total quarter ending net finance receivables were
$7.7 billion, which was up 4 percent
versus prior year, driven primarily by an increase in wholesale
commercial lending receivables.
LiveWire – Results
$ in
millions
|
3rd quarter
|
2023
|
2022
|
Change
|
Electric Motorcycle
Shipments (units)
|
50
|
206
|
-76 %
|
Revenue
|
$8
|
$15
|
-45 %
|
Operating
Loss
|
($25)
|
($21)
|
NM
|
With the majority of Del Mar shipments landing in Q4, LiveWire
revenue for the third quarter was down versus prior year. LiveWire
operating loss of $25 million in the
third quarter, in-line with expectations, was driven by product
development and other spending associated with the launch of the
Del Mar electric motorcycle.
Other Harley-Davidson, Inc. 2023 Results – through end
of Q3 2023
- Generated $707 million of cash
from operating activities
- Effective tax rate was 22 percent
- Paid cash dividends of $73
million
- Repurchased $226 million of
shares (6.1 million shares) on a discretionary basis
- Cash and cash equivalents of $1.9
billion at the end of the quarter
- Financing raised for HDFS of $2.5
billion
2023 Financial Outlook
For the full year 2023, the Company reaffirms its most recent
guidance and continues to expect:
- HDMC: revenue growth of flat to 3% and operating income margin
of 13.9 to 14.3%
- HDFS: operating income decline of 20 to 25%
- LiveWire: motorcycle unit sales of 600–1,000 and operating loss
of $115 to $125 million
- Harley-Davidson, Inc.: capital investments of $225 to $250
million
Segment Reporting Structure
LiveWire Group, Inc. ("LiveWire Group") became a separate public
company trading on the New York Stock Exchange (Ticker: LVWR) on
September 27, 2022. Harley-Davidson
has a controlling equity interest in LiveWire Group and continues
to consolidate LiveWire Group results with adjustments for
non-controlling shareholder interests. Net Income attributable to
Harley-Davidson, Inc. and EPS reflect these adjustments.
Beginning with the fourth quarter of 2022, new business segment
reporting now includes:
- Harley-Davidson Motor Company (HDMC): Group that is
accountable for the design, manufacturing, marketing and sales of
Harley-Davidson motorcycles and related products
- Harley-Davidson Financial Services (HDFS): Group that
provides motorcycle and related products financing and insurance
products and services for our dealers and retail customers
- LiveWire: Group that is accountable for the design,
marketing and sales of LiveWire electric motorcycles and related
products, including STACYC electric balance bikes
Prior period segment results have been retrospectively adjusted
based on the new segments. In addition, the consolidated results
will continue to be reflected by:
- Harley-Davidson, Inc. (HDI): Corporate entity for the
overall Company, under which HDMC, HDFS and LiveWire operate
Company Background
Harley-Davidson,
Inc. is the parent company of Harley-Davidson Motor
Company and Harley-Davidson Financial Services. Our
vision: Building our legend and leading our industry through
innovation, evolution and emotion. Our mission: More than building
machines, we stand for the timeless pursuit of adventure. Freedom
for the soul. Our ambition is to maintain our place as the most
desirable motorcycle brand in the world. Since 1903,
Harley-Davidson has defined motorcycle culture by delivering a
motorcycle lifestyle with distinctive and customizable motorcycles,
experiences, motorcycle accessories, riding gear and
apparel. Harley-Davidson Financial Services provides
financing, insurance and other programs to help get riders on the
road. Harley-Davidson also has a controlling interest in
LiveWire Group, Inc., the first publicly traded all-electric
motorcycle company in the United
States. LiveWire is the future in the making for the pursuit
of urban adventure and beyond. Drawing on its DNA as an agile
disruptor from the lineage of Harley-Davidson and capitalizing on a
decade of learnings in the EV sector, LiveWire's ambition is to be
the most desirable electric motorcycle brand in the world. Learn
more at harley-davidson.com and livewire.com.
Webcast
Harley-Davidson will discuss its
financial results and outlook on an audio webcast at 8:00 a.m.
CT today. The webcast login and supporting slides can be accessed
at http://investor.harley-davidson.com/news-and-events/events-and-presentations.
The audio replay will be available by approximately 10:00 a.m. CT.
Cautionary Note Regarding Forward-Looking
Statements
The Company intends that certain matters
discussed in this press release are "forward-looking statements"
intended to qualify for the safe harbor from liability established
by the Private Securities Litigation Reform Act of 1995. These
forward-looking statements can generally be identified as such by
reference to this footnote or because the context of the statement
will include words such as the Company "believes," "anticipates,"
"expects," "plans," "may," "will," "estimates," "targets,"
"intends," "forecasts," "sees," or words of similar meaning.
Similarly, statements that describe or refer to future
expectations, future plans, strategies, objectives, outlooks,
targets, guidance, commitments or goals are also forward-looking
statements. Such forward-looking statements are subject to certain
risks and uncertainties that could cause actual results to differ
materially, unfavorably or favorably, from those anticipated as of
the date of this press release. Certain of such risks and
uncertainties are described below. Shareholders, potential
investors, and other readers are urged to consider these factors in
evaluating the forward-looking statements and are cautioned not to
place undue reliance on such forward-looking statements. The
forward-looking statements included in this press release are only
made as of the date of this press release, and the Company
disclaims any obligation to publicly update such forward-looking
statements to reflect subsequent events or circumstances.
Important factors that could affect future results and cause
those results to differ materially from those expressed in the
forward-looking statements include, among others, the Company's
ability to: (a) execute its business plans and strategies,
including The Hardwire, each of the pillars, and the evolution
of LiveWire as a standalone brand, which includes the risks
noted below; (b) manage supply chain and logistics issues,
including quality issues, availability of semiconductor chip
components and the ability to find alternative sources of those
components in a timely manner, unexpected interruptions or price
increases caused by supplier volatility, raw material shortages,
inflation, war or other hostilities, including the conflict in
Ukraine, or natural disasters and
longer shipping times and increased logistics costs, including by
successfully implementing pricing surcharges; (c) accurately
analyze, predict and react to changing market conditions and
successfully adjust to shifting global consumer needs and
interests; (d) realize the expected business benefits from LiveWire
operating as a separate public company, which may be affected by,
among other things: (I) the ability of LiveWire to: (1) execute its
plans to develop, produce, market and sell its electric vehicles;
(2) achieve profitability, which is dependent on the successful
development and commercial introduction and acceptance of its
electric vehicles, and its services, which may not occur; (3)
adequately control the costs of its operations as a new entrant
into a new space; (4) develop, maintain and strengthen its brand;
(5) execute its plans to develop, produce, market and sell its
electric vehicles on expected timelines; and (6) effectively
establish and maintain cooperation from its retail partners,
largely drawn from the Company's traditional motorcycle dealer
network, to be able to effectively establish or maintain
relationships with customers for electric vehicles; (II)
competition; and (III) other risks and uncertainties indicated in
documents filed with the SEC by the Company or LiveWire Group,
Inc., including those risks and uncertainties noted in Risk Factors
under Item 1.A of LiveWire Group Inc.'s Annual Report on Form 10-K
for the year ended December 31, 2022; (e) successfully access the
capital and/or credit markets on terms that are acceptable to the
Company and within its expectations; (f) successfully carry out its
global manufacturing and assembly operations; (g) develop and
introduce products, services and experiences on a timely basis that
the market accepts, that enable the Company to generate desired
sales levels and that provide the desired financial returns,
including successfully implementing and executing plans to
strengthen and grow its leadership position in Grand American
Touring, large Cruiser and Trike, and grow its complementary
businesses; (h) perform in a manner that enables the Company to
benefit from market opportunities while competing against existing
and new competitors; (i) manage the quality and regulatory
non-compliance issues relating to the brake hose assemblies
provided to the Company by Proterial Cable America (PCA) in a
manner that avoids future quality or non-compliance issues and
additional costs or recall expenses that are material; (j)
effectively mitigate the impact on the Company's business of the
production suspensions that were caused by the quality issues and
regulatory non-compliances of PCA's brake hose assemblies,
including but not limited to the impact on wholesale and retail
sales of new motorcycles; (k) manage ongoing risks related to the
impact of the COVID-19 pandemic, such as supply chain disruptions,
its ability to carry out business as usual, and government actions
and restrictive measures implemented in response; (l) successfully
appeal: (I) the revocation of the Binding Origin Information (BOI)
decisions that allowed the Company to supply its European Union
(EU) market with certain of its motorcycles produced at its
Thailand operations at a reduced tariff rate and (II) the denial of
the Company's application for temporary relief from the effect of
the revocation of the BOI decisions; (m) manage and predict the
impact that new, reinstated or adjusted tariffs may have on the
Company's ability to sell products internationally, and the cost of
raw materials and components, including the temporary lifting of
the Section 232 steel and aluminum tariffs and incremental tariffs
on motorcycles imported into the EU from the U.S., between the U.S.
and EU, which expires on December 31, 2023; (n) prevent, detect and
remediate any issues with its motorcycles or any issues associated
with the manufacturing processes to avoid delays in new model
launches, recall campaigns, regulatory agency investigations,
increased warranty costs or litigation and adverse effects on its
reputation and brand strength, and carry out any product programs
or recalls within expected costs and timing; (o) manage the impact
that prices for and supply of used motorcycles may have on its
business, including on retail sales of new motorcycles; (p)
successfully manage and reduce costs throughout the business; (q)
manage through changes in general economic and business conditions,
including changing capital, credit and retail markets, particularly
with the recent turmoil in the banking industry, and the changing
domestic and international political environments, including as a
result of the conflict in Ukraine; (r) continue to develop the
capabilities of its distributors and dealers, effectively implement
changes relating to its dealers and distribution methods and manage
the risks that its dealers may have difficulty obtaining capital
and managing through changing economic conditions and consumer
demand; (s) continue to develop and maintain a productive
relationship with Zhejiang Qianjiang Motorcycle Co., Ltd. and
launch related products in a timely manner; (t) maintain a
productive relationship with Hero MotoCorp as a distributor and
licensee of the Harley-Davidson brand name in India; (u)
successfully maintain a manner in which to sell motorcycles in
China and the Company's Association of Southeast Asian Nations
(ASEAN) countries that does not subject its motorcycles to
incremental tariffs; (v) manage its Thailand corporate and
manufacturing operation in a manner that allows the Company to
avail itself of preferential free trade agreements and duty rates,
and sufficiently lower prices of its motorcycles in certain
markets; (w) accurately estimate and adjust to fluctuations in
foreign currency exchange rates, interest rates and commodity
prices; (x) retain and attract talented employees, and eliminate
personnel duplication, inefficiencies and complexity throughout the
organization; (y) prevent a cybersecurity breach involving
consumer, employee, dealer, supplier, or Company data and respond
to evolving regulatory requirements regarding data security; (z)
manage the credit quality, the loan servicing and collection
activities, and the recovery rates of Harley-Davidson Financial
Services' loan portfolio; (aa) adjust to tax reform, healthcare
inflation and reform and pension reform, and successfully estimate
the impact of any such reform on the Company's business; (bb)
manage through the effects inconsistent and unpredictable weather
patterns may have on retail sales of motorcycles; (cc) implement
and manage enterprise-wide information technology systems,
including systems at its manufacturing facilities; (dd) manage
changes, prepare for, and respond to evolving requirements in
legislative and regulatory environments related to its products,
services and operations; (ee) manage its exposure to product
liability claims and commercial or contractual disputes; (ff)
continue to manage the relationships and agreements that the
Company has with its labor unions to help drive long-term
competitiveness; (gg) achieve anticipated results with respect to
the Company's preowned motorcycle program, Harley-Davidson
Certified, the Company's H-D1 Marketplace, and Apparel and
Licensing; (hh) accurately predict the margins of its segments in
light of, among other things, tariffs, inflation, foreign currency
exchange rates, the cost associated with product development
initiatives and the Company's complex global supply chain; and (ii)
optimize capital allocation in light of the Company's capital
allocation priorities; and (jj) manage through the effects
increased environmental, safety, emissions or other regulations or
other influences may have on the business and its operating
results.
The Company's ability to sell its motorcycles and related
products and services and to meet its financial expectations also
depends on the ability of the Company's dealers to sell its
motorcycles and related products and services to retail customers.
The Company depends on the capability and financial capacity of its
dealers to develop and implement effective retail sales plans to
create demand for the motorcycles and related products and services
they purchase from the Company. In addition, the Company's dealers
and distributors may experience difficulties in operating their
businesses and selling Harley-Davidson motorcycles and related
products and services as a result of weather, economic conditions,
the impact of the COVID-19 pandemic, or other factors.
In recent years, Harley-Davidson Financial Services experienced
historically low levels of retail credit losses, but credit losses
have been normalizing to higher levels in recent quarters. Further,
the Company believes that HDFS's retail credit losses will continue
to change over time due to changing consumer credit behavior,
macroeconomic conditions including the impact of inflation, and
HDFS's efforts to adjust underwriting criteria based on market and
economic conditions, as well as actions that the Company has taken
and could take that impact motorcycle values.
The Company's operations, demand for its products, and its
liquidity could be adversely impacted by work stoppages, facility
closures, strikes, natural causes, widespread infectious disease,
terrorism, war or other hostilities, including the conflict in
Ukraine, or other factors. Refer
to "Risk Factors" under Item 1.A of the Company's Annual Report on
Form 10-K for the year ended December 31,
2022 for a discussion of additional risk factors and a more
complete discussion of some of the cautionary statements noted
above.
### (HOG-Earnings)
Harley-Davidson,
Inc.
|
Condensed Consolidated
Statements of Operations
|
(In thousands, except
per share amounts)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Nine months
ended
|
|
|
September
30,
|
|
September
25,
|
|
September
30,
|
|
September
25,
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
|
|
|
|
|
|
|
HDMC revenue
|
|
$
1,296,981
|
|
$
1,422,254
|
|
$
4,052,946
|
|
$
3,968,989
|
Gross profit
|
|
410,690
|
|
489,341
|
|
1,385,190
|
|
1,284,063
|
Selling, administrative
and engineering expense
|
|
235,437
|
|
210,227
|
|
679,864
|
|
575,364
|
Restructuring expense
(benefit)
|
|
-
|
|
3
|
|
-
|
|
(389)
|
Operating income
from HDMC
|
|
175,253
|
|
279,111
|
|
705,326
|
|
709,088
|
|
|
|
|
|
|
|
|
|
LiveWire
revenue
|
|
8,144
|
|
14,708
|
|
22,932
|
|
37,615
|
Gross profit
(loss)
|
|
1,092
|
|
965
|
|
(584)
|
|
628
|
Selling, administrative
and engineering expense
|
|
26,435
|
|
22,314
|
|
81,290
|
|
57,392
|
Operating loss
from Livewire
|
|
(25,343)
|
|
(21,349)
|
|
(81,874)
|
|
(56,764)
|
|
|
|
|
|
|
|
|
|
HDFS revenue
|
|
243,934
|
|
211,613
|
|
707,390
|
|
606,244
|
HDFS expense
|
|
184,559
|
|
130,657
|
|
530,610
|
|
353,003
|
Operating income
from HDFS
|
|
59,375
|
|
80,956
|
|
176,780
|
|
253,241
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
209,285
|
|
338,718
|
|
800,232
|
|
905,565
|
Other income,
net
|
|
26,814
|
|
9,358
|
|
54,136
|
|
30,443
|
Investment income
(loss)
|
|
9,868
|
|
1,723
|
|
31,044
|
|
(3,786)
|
Interest
expense
|
|
(7,688)
|
|
(8,124)
|
|
(23,104)
|
|
(23,555)
|
Income before income
taxes
|
|
238,279
|
|
341,675
|
|
862,308
|
|
908,667
|
Income tax
provision
|
|
42,176
|
|
80,489
|
|
190,546
|
|
209,130
|
Net income
|
|
$
196,103
|
|
$
261,186
|
|
$
671,762
|
|
$
699,537
|
Less: Loss attributable
to noncontrolling interests
|
|
2,546
|
|
-
|
|
9,016
|
|
-
|
Net income attributable
to Harley-Davidson, Inc.
|
|
$
198,649
|
|
$
261,186
|
|
$
680,778
|
|
$
699,537
|
|
|
|
|
|
|
|
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
|
Basic
|
|
$
1.40
|
|
$
1.79
|
|
$
4.74
|
|
$
4.71
|
Diluted
|
|
$
1.38
|
|
$
1.78
|
|
$
4.65
|
|
$
4.68
|
|
|
|
|
|
|
|
|
|
Weighted-average
shares:
|
|
|
|
|
|
|
|
|
Basic
|
|
141,622
|
|
146,217
|
|
143,678
|
|
148,673
|
Diluted
|
|
144,321
|
|
147,073
|
|
146,330
|
|
149,535
|
|
|
|
|
|
|
|
|
|
Cash dividends per
share:
|
|
$
0.1650
|
|
$
0.1575
|
|
$
0.4950
|
|
$
0.4725
|
|
|
|
|
|
|
|
|
|
The Company operates in
three reportable segments: Harley-Davidson Motor Company (HDMC),
LiveWire and Harley-Davidson Financial Services (HDFS). The Company
changed its segments in the period ended December 31, 2022. The
change has been retrospectively reflected in the Company's
results.
|
LiveWire results
presented in the Company's financial statements represent the
LiveWire reportable segment as determined in accordance with
Financial Accounting Standards Board (FASB) Accounting Standards
Codification (ASC) 280 Segment
Reporting which may differ
from LiveWire Group, Inc. results.
|
Harley-Davidson,
Inc.
|
Condensed Consolidated
Balance Sheets
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
(Unaudited)
|
|
|
|
|
September
30,
|
|
December 31,
|
|
September
25,
|
|
|
|
|
2023
|
|
2022
|
|
2022
|
ASSETS
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
|
Cash
and cash equivalents
|
|
|
|
$
1,878,351
|
|
$
1,433,175
|
|
$
1,730,250
|
Accounts receivable, net
|
|
|
|
315,331
|
|
252,225
|
|
300,454
|
Finance receivables, net
|
|
|
|
2,101,965
|
|
1,782,631
|
|
1,807,718
|
Inventories, net
|
|
|
|
768,765
|
|
950,960
|
|
680,762
|
Restricted cash
|
|
|
|
130,838
|
|
135,424
|
|
287,264
|
Other current assets
|
|
|
|
227,556
|
|
196,238
|
|
205,734
|
|
|
|
|
5,422,806
|
|
4,750,653
|
|
5,012,182
|
|
|
|
|
|
|
|
|
|
Finance receivables,
net
|
|
|
|
5,553,259
|
|
5,355,807
|
|
5,534,730
|
Other long-term
assets
|
|
|
|
1,486,151
|
|
1,386,016
|
|
1,380,699
|
|
|
|
|
$ 12,462,216
|
|
$ 11,492,476
|
|
$ 11,927,611
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
Accounts payable and accrued liabilities
|
|
|
|
$
968,261
|
|
$
998,947
|
|
$
1,149,078
|
Short-term deposits, net
|
|
|
|
250,987
|
|
79,710
|
|
97,856
|
Short-term debt
|
|
|
|
815,081
|
|
770,468
|
|
692,551
|
Current portion of long-term debt, net
|
|
|
|
638,496
|
|
1,684,782
|
|
1,740,422
|
|
|
|
|
2,672,825
|
|
3,533,907
|
|
3,679,907
|
|
|
|
|
|
|
|
|
|
Long-term debt,
net
|
|
|
|
5,856,005
|
|
4,457,052
|
|
4,738,234
|
Other long-term
liabilities
|
|
|
|
622,116
|
|
594,709
|
|
669,260
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
3,311,270
|
|
2,906,808
|
|
2,840,210
|
|
|
|
|
$ 12,462,216
|
|
$ 11,492,476
|
|
$ 11,927,611
|
Harley-Davidson,
Inc.
|
Condensed Consolidated
Statements of Cash Flows
|
(In
thousands)
|
(Unaudited
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine months
ended
|
|
|
|
|
|
|
September
30,
|
|
September
25,
|
|
|
|
|
|
|
2023
|
|
2022
|
|
|
|
|
|
|
|
|
|
Net cash provided by
operating activities
|
|
|
|
|
|
$
706,767
|
|
$
574,704
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
|
|
|
|
(138,902)
|
|
(84,947)
|
Finance
receivables, net
|
|
|
|
|
|
(373,109)
|
|
(662,949)
|
Other investing
activities
|
|
|
|
|
|
878
|
|
2,160
|
Net cash used by
investing activities
|
|
|
|
|
|
(511,133)
|
|
(745,736)
|
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
Proceeds from
issuance of medium-term notes
|
|
|
|
|
|
1,446,304
|
|
495,785
|
Repayments of
medium-term notes
|
|
|
|
|
|
(1,056,680)
|
|
(950,000)
|
Proceeds from
securitization debt
|
|
|
|
|
|
1,045,547
|
|
1,826,891
|
Repayments of
securitization debt
|
|
|
|
|
|
(930,608)
|
|
(1,054,939)
|
Net increase
(decrease) in unsecured commercial paper
|
|
|
|
|
|
43,523
|
|
(60,281)
|
Borrowings of
asset-backed commercial paper
|
|
|
|
|
|
42,429
|
|
448,255
|
Repayments of
asset-backed commercial paper
|
|
|
|
|
|
(187,599)
|
|
(228,431)
|
Net increase in
deposits
|
|
|
|
|
|
161,157
|
|
54,080
|
Deposit in
advance of business combination
|
|
|
|
|
|
-
|
|
100,000
|
Dividends
paid
|
|
|
|
|
|
(72,775)
|
|
(70,163)
|
Repurchase of
common stock
|
|
|
|
|
|
(239,428)
|
|
(338,496)
|
Other financing
activities
|
|
|
|
|
|
1,706
|
|
(1,237)
|
Net cash provided by
financing activities
|
|
|
|
|
|
253,576
|
|
221,464
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate
changes on cash, cash equivalents and restricted cash
|
|
|
|
(8,415)
|
|
(33,361)
|
|
|
|
|
|
|
|
|
|
Net increase in cash,
cash equivalents and restricted cash
|
|
|
|
|
|
$
440,795
|
|
$
17,071
|
|
|
|
|
|
|
|
|
|
Cash, cash equivalents
and restricted cash:
|
|
|
|
|
|
|
|
|
Cash, cash equivalents
and restricted cash, beginning of period
|
|
|
|
|
|
$
1,579,177
|
|
$
2,025,219
|
Net increase in cash,
cash equivalents and restricted cash
|
|
|
|
|
|
440,795
|
|
17,071
|
Cash, cash equivalents
and restricted cash, end of period
|
|
|
|
|
|
$
2,019,972
|
|
$
2,042,290
|
|
|
|
|
|
|
|
|
|
Reconciliation of cash,
cash equivalents and restricted cash on the Consolidated balance
sheets to the Consolidated statements of cash
flows:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
|
|
|
$
1,878,351
|
|
$
1,730,250
|
Restricted
cash
|
|
|
|
|
|
130,838
|
|
287,264
|
Restricted cash
included in Other long-term assets
|
|
|
|
|
|
10,783
|
|
24,776
|
Cash, cash
equivalents and restricted cash per the Consolidated statements of
cash flows
|
|
|
$
2,019,972
|
|
$
2,042,290
|
HDMC Revenue and
Motorcycle Shipment Data
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Nine months
ended
|
|
|
September
30,
|
|
September
25,
|
|
September
30,
|
|
September
25,
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
HDMC REVENUE (in
thousands)
|
|
|
|
|
|
|
|
|
Motorcycles
|
|
$
1,023,090
|
|
$
1,128,920
|
|
$
3,216,387
|
|
$
3,121,097
|
Parts and
accessories
|
|
184,809
|
|
200,708
|
|
568,001
|
|
580,295
|
Apparel
|
|
49,325
|
|
69,819
|
|
187,072
|
|
198,560
|
Licensing
|
|
9,586
|
|
10,662
|
|
20,912
|
|
28,940
|
Other
|
|
30,171
|
|
12,145
|
|
60,574
|
|
40,097
|
|
|
$
1,296,981
|
|
$
1,422,254
|
|
$
4,052,946
|
|
$
3,968,989
|
|
|
|
|
|
|
|
|
|
HDMC U.S. MOTORCYCLE
SHIPMENTS
|
|
30,167
|
|
36,997
|
|
96,984
|
|
100,997
|
|
|
|
|
|
|
|
|
|
HDMC WORLDWIDE
MOTORCYCLE SHIPMENTS
|
|
|
|
|
|
|
|
|
Grand American Touring(a)
|
|
23,781
|
|
27,521
|
|
76,270
|
|
75,291
|
Cruiser
|
|
17,142
|
|
17,197
|
|
53,876
|
|
47,325
|
Sport and Lightweight
|
|
3,103
|
|
10,079
|
|
15,849
|
|
28,185
|
Adventure Touring
|
|
1,243
|
|
2,058
|
|
4,445
|
|
8,743
|
|
|
45,269
|
|
56,855
|
|
150,440
|
|
159,544
|
(a)
Includes Trike
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LiveWire Motorcycle
Shipments
|
|
50
|
|
206
|
|
146
|
|
528
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HDMC Gross
Profit
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
The estimated impact of
significant factors affecting the comparability of gross profit
from the third quarter of 2022 to the third quarter of 2023 were as
follows (in millions):
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
|
Nine months
ended
|
|
|
2022 gross
profit
|
|
$
489
|
|
|
|
$
1,284
|
|
|
Volume
|
|
(92)
|
|
|
|
(91)
|
|
|
Price and sales
incentives
|
|
45
|
|
|
|
199
|
|
|
Foreign currency
exchange rates and hedging
|
|
(19)
|
|
|
|
(54)
|
|
|
Shipment mix
|
|
41
|
|
|
|
83
|
|
|
Raw material
prices
|
|
8
|
|
|
|
22
|
|
|
Manufacturing and other
costs
|
|
(61)
|
|
|
|
(58)
|
|
|
|
|
(78)
|
|
|
|
101
|
|
|
2023 gross
profit
|
|
$
411
|
|
|
|
$
1,385
|
|
|
HDFS Finance
Receivables Allowance for Credit Losses
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Nine months
ended
|
|
|
September
30,
|
|
September
25,
|
|
September
30,
|
|
September
25,
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Balance, beginning of
period
|
|
$
381,780
|
|
$
352,137
|
|
$
358,711
|
|
$
339,379
|
Provision for credit
losses
|
|
60,854
|
|
36,617
|
|
170,496
|
|
94,572
|
Charge-offs, net of
recoveries
|
|
(49,920)
|
|
(28,658)
|
|
(136,493)
|
|
(73,855)
|
Balance, end of
period
|
|
$
392,714
|
|
$
360,096
|
|
$
392,714
|
|
$
360,096
|
Worldwide Retail Sales
of Harley-Davidson Motorcycles(a)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Nine months
ended
|
|
|
September
30,
|
|
September
30,
|
|
September
30,
|
|
September
30,
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
|
|
|
|
|
|
|
United
States
|
|
25,336
|
|
29,838
|
|
81,774
|
|
90,823
|
Canada
|
|
2,010
|
|
2,153
|
|
6,653
|
|
7,108
|
Total North
America
|
|
27,346
|
|
31,991
|
|
88,427
|
|
97,931
|
EMEA
|
|
7,847
|
|
9,002
|
|
21,884
|
|
23,948
|
Asia Pacific
|
|
5,784
|
|
7,629
|
|
20,190
|
|
20,373
|
Latin
America
|
|
681
|
|
765
|
|
2,108
|
|
2,365
|
Total worldwide retail
sales
|
|
41,658
|
|
49,387
|
|
132,609
|
|
144,617
|
|
|
|
|
|
|
|
|
|
(a)
Data source for retail sales figures
shown above is new sales warranty and registration information
provided by dealers and compiled by the Company. The Company must
rely on information that its dealers supply concerning new retail
sales, and the Company does not regularly verify the information
that its dealers supply. This information is subject to
revision.
|
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SOURCE Harley-Davidson, Inc.